FreshDirect grocery delivery service comes to Montgomery County

FreshDirect, the popular online grocery delivery service that’s become a way of life for countless New Yorkers for the past decade — and, since October, for thousands of Philadelphians, too — is coming to Montgomery County on Jan. 28.

“We felt confident that Philly would be a great city for us, and now that we’ve gotten our feet wet and there’s been so much demand, we thought it was time to move into the suburban areas,” said FreshDirect co-founder and CEO Jason Ackerman. “We’ve found that no matter where people live, they like great-quality fresh food at great prices, with the convenience that we provide.”

The growing company specializes in delivering a wide variety of fresh food — including meats, vegetables, fruits, seafood, dairy products, prepared meals and baked goods — to customers’ homes at prices that are competitive with many supermarkets. FreshDirect has found success with a process that drastically shortens down the supply chain: They get their products directly from dozens of local farms, dairies and fisheries, bring them to a large facility (in our area, it’s located in the Port Richmond section of Philadelphia) where a staff of nearly 40 butchers, chefs and other food professionals process meats and seafood, sort produce, bake breads and pastries, put together meal kits, and more. They then deliver those products (as well as popular grocery brands), for a fee, to customers who place orders online.

By cutting out an array of middlemen and eliminating the overhead of traditional brick-and-mortar supermarkets — creating a business model that Ackerman likens, in some ways, to online retailer Amazon.com — the company has managed to keep prices reasonable and still make a profit.

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“We weren’t profitable for many years because we were trying to get the business model and the technology just right and make the experience the best it could possibly be for the customer, and we think we’ve developed a service that really works well and is positioned to thrive in the long term,” said Ackerman, who spent 10 years as an investment banker specializing in supermarket mergers and acquisitions before co-founding FreshDirect in 1999 and beginning deliveries to customers in 2002.

It works thusly: Customers go to FreshDirect.com, select from thousands of items (including organic, kosher and gluten-free products) and place an order anywhere from a week to 24 hours before the desired delivery date. In the greater Philadelphia area, including Montgomery County, there’s a minimum order of $30, and each delivery costs $7.99. Deliveries can be scheduled between 6 a.m. and 11 p.m. seven days a week.

No membership is involved, although customers can sign up for DeliveryPass, which enables unlimited deliveries throughout a six-month period for a flat fee of $69 (FreshDirect is currently offering new customers a two-month trial of DeliveryPass for one cent). Like most supermarket chains, FreshDirect offers weekly discount specials (called “President’s Picks”), they have an e-coupon program, and the company provides guaranteed freshness dates.

“With our business model, we cut out four to eight days from the typical supermarket process of getting the food from the farm to their stores to your table, so our food is much fresher and we take a lot of pride in that,” said Ackerman.

“It’s a better retail experience than the traditional supermarket,” said Ackerman. “We make sure our prices are highly competitive with chains like Giant, while we try to top the quality standard of Whole Foods. It’s all about sourcing. We basically try to be your farmers market, but we bring it right to you, and our customers say that the convenience and time-saving factor of not having to go to the supermarket — and don’t forget, the closest supermarket to you isn’t necessarily the one you choose to shop at — or to a bunch of different specialty stores is well worth the delivery costs.”

Ackerman added that FreshDirect is committed to eco-friendly business practices — such as using delivery packaging that’s 100-percent recyclable — and that they waste far less food than supermarkets. For example, he explained, “we custom-cut all of our meat to order, whereas supermarkets cut meat ahead of time and put it in the case, and if it doesn’t sell in a couple of days they have to throw it out.”

Through word-of-mouth alone, Ackerman said, FreshDirect has gotten emails from thousands of potential customers in Montgomery County throughout the past few months expressing interest in the service, which is why the company decided to expand its delivery zone into the county. And with direct mail and radio campaigns getting under way as the Jan. 28 start-date approaches, Ackerman predicts FreshDirect’s delivery drivers will soon be exceptionally busy making runs to the area.

“I’m really passionate about food, and it’s all about building a better food company,” he said. “And I believe that’s what this is.”

Follow Michael Alan Goldberg on Twitter @mg_thereporter.

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